Party Gridlock in Washington Feeds New Fear of Debt Crisis

Those bipartisan deals were done during times of divided government, when one party had the White House and the other controlled at least one chamber of Congress, giving each side some governing responsibility to find solutions. Now, with Democrats controlling the White House and Congress, the parties have less incentive to work together.

AP

Republicans today see opposition as a way back to power in November, and their party is more ideologically antitax than in the past, especially now that it is courting the Tea Party movement. Conservative activists so oppose compromise of any sort that several lawmakers have drawn primary challengers for working with Democrats.

Because the worst of the fiscal problem remains years away and therefore somewhat hypothetical to most people, there is also not the same incentive to act immediately that drove, for example, the 1983 deal, when Social Security was facing an imminent crisis.

“We literally tweaked the Social Security system,” Mr. Simpson said. The changes, which still are being phased in 27 years later, resulted in big savings over time. Economists say future measures will have to be more severe the longer they are delayed.

In 1987, a global markets crash led the Reagan administration and Democrats to agree to a deficit-reduction package of spending cuts and tax increases. In 1990, the successful budget summit between Democrats and the administration of President George Bush came about after deficits had spiked again, threatening a fiscal crisis of mandatory and deep across-the-board cuts.

Yet Mr. Bush’s breaking of his “no new taxes” promise so infuriated conservatives that they helped defeat him in 1992. One of his critics was Newt Gingrich of Georgia. By the mid-1990s, Mr. Gingrich was House speaker and his party controlled Congress. After a politically damaging government shutdown, in 1997 he reached a deal with Mr. Clinton that helped balance the budget.

When George W. Bush took office in 2001, the government projected surpluses of $5.6 trillion for the coming decade.

In an analysis of what happened next, the economists Alan J. Auerbach and William G. Gale found that much of the accumulated debt owes to Bush-era policies and to the recession, with its costs in lost income taxes and automatic benefits for the unemployed. The one-time costs of stimulus and bailout measures are “really small stuff” relative to the rest, Mr. Auerbach said.

More than Mr. Obama could have imagined, the situation now tests his promise to break Washington’s gridlock and to lead in making “the hard choices.”

Privately, Treasury Secretary Timothy F. Geithner and other administration officials are courting Republicans with assurances of the administration’s sincerity about bipartisanship. Publicly, and with advice from some out-of-office Republicans, the White House is applying pressure by repeatedly reminding Americans of the mess Mr. Obama inherited.

Polls are helping the administration make its case, people in both parties say. In the latest New York Times/CBS News poll, Americans by a two-to-one ratio say Mr. Obama is trying to work with Republicans, while by more than two-to-one they say Republicans are not reciprocating. As for the deficit, 41 percent say the Bush administration is most to blame, 24 percent say Congress and 7 percent say Mr. Obama.

Yet politicians’ failure to reduce deficits has long reflected voters’ opposition to the necessary steps. The poll also found that by a two-to-one ratio Americans oppose cutting health care and education; 51 percent oppose lower military spending.